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Pension Plan and Stock Compensation
6 Months Ended
Jun. 30, 2023
Pension Plan and Stock Compensation  
Pension Plan and Stock Compensation

Note 6 — Pension Plan and Stock Compensation

The Bank has a funded noncontributory defined benefit pension plan that covers substantially all employees meeting certain eligibility requirements. The pension plan was closed to new participants and benefit accruals were frozen as of December 31, 2015. The plan provides defined benefits based on years of service and final average salary.

The components of net periodic benefit cost for the Company’s noncontributory defined benefit pension plan for the three and six months ended June 30, 2023 and 2022 are as follows:

    

Three Months Ended June 30, 

Six Months Ended June 30, 

    

2023

    

2022

2023

    

2022

Service cost

$

$

$

$

Interest cost

 

279

 

202

 

557

 

404

Expected return on plan assets

 

(411)

 

(496)

 

(822)

 

(992)

Amortization of transition cost

 

 

(7)

 

 

(14)

Amortization of net loss

 

70

 

 

141

 

Net periodic benefit cost/(income)

$

(62)

$

(301)

$

(124)

$

(602)

The Company has a time based restricted stock plan. For the three months ended June 30, 2023 and 2022, the Company’s recognized stock-based compensation costs were $8 and $33, respectively. For the six months ended June 30, 2023 and 2022 the Company’s recognized stock-based compensation costs of $36 and $100, respectively. The Company uses the fair value of the common stock on the date of award to measure compensation cost for restricted stock awards. Compensation cost is recognized over the vesting period of the award using the straight line method. There were no restricted stock grants made during the three and six months ended June 30, 2023 and 2022. The grants generally vest at the rate of 33% per year with full vesting on the third anniversary date of the grant. Unamortized expense at June 30, 2023 was $21.

A summary of the Company’s restricted stock awards activity for the six months ended June 30, 2023 is presented below:

    

    

Weighted

Average Fair

Shares

Value

Non-vested at beginning of period

 

11,677

$

29.24

Granted

 

$

Vested

 

(7,569)

$

29.50

Forfeited

 

(414)

$

28.75

Non-vested at end of period

 

3,694

$

28.75

On September 22, 2021 restricted stock units (RSUs) were granted in the amount of 48,004 from the Companys 2019 Equity Incentive Plan to officers of the Bank and HVIA and directors of the Company in connection with the successful completion of the Companys initial public stock offering, listing on the NASDAQ Capital Market and the recent past years success experienced by the Bank. Non-employee directors received 16,500 restricted stock units while officers received 31,504 restricted stock units. The restricted stock units granted to officers will vest over three years in approximately 33% increments on the first, second and third anniversary of the date of grant. The restricted stock units granted to nonemployee directors are 100% vested as of the date of grant and are settled in shares of Company common stock upon separation from service. In addition, the Company made a discretionary contribution of $200,000 to the Companys KSOP Trust and purchased shares of the Companys common stock in the open market for the benefit of all eligible non-highly compensated employees who remain employed by the Company, Bank or HVIA as of December 31, 2021.

The following table summarizes the activity of RSUs during the six months ended June 30, 2023:

Restricted Stock Units

Non-vested RSUs at beginning of period

 

59,747

Granted

 

22,650

Vested

 

(8,486)

Forfeited

 

(4,725)

Non-vested RSUs at end of period

 

69,186